Thomas Cook reports increased summer bookings

Bookings at higher margin ‘concept’ hotels are up 49% at Thomas Cook as Europe’s second largest travel group reported increased summer bookings.

The summer programme is already 50% sold, 1% more than this time last year with overall bookings 2% higher.

Bookings in the UK are 3% higher than last year with a 1% reduction in capacity.

However, average selling prices are 2% lower due mainly to product mix and a higher proportion of shorter duration holidays reflecting customer demand, partially offset by new product and cost out and profit improvement benefits, Cook said.

Cook admitted that overall winter bookings had been “adversely affected” by continued social unrest in Egypt, leaving the programme 93% sold.

UK bookings, excluding Egypt, are 2% up but prices were down by 3%.

Chief executive Harriet Green confirmed that the company had completed its planned disposals target 18 months early following the offloading of Cook’s interest in The Airline Group, shareholder in the national air traffic service (Nats).

In a trading update this morning, she said: “Delivery of our strategy of sustained profitable growth remains on track and our trading, with increased summer bookings, is encouraging.

“Winter trading has been satisfactory, despite the significant market disruption caused by continued unrest in Egypt, as our businesses have worked successfully together to offer our customers a wider choice of destinations.

“Customer bookings for the summer 2014 season have shown an improving trend since we reported our first quarter results with around 50% of holidays already sold, slightly higher than at this stage last year.

“Compared with last year, margins are expected to improve more than average selling prices, reflecting enhanced yield management and the benefits of our cost out and profit improvement programme, which is delivering ahead of schedule.”

She added: “The continuing transformation of Thomas Cook, including the delivery of our strategic targets, remains our top priority.”

A full update will be provided at the group’s half-year results announcement on May 15, together with details of further new product development and the second wave of our profit improvement plans, Green revealed.